China Watch: China And Saudi Arabia Strengthening Ties
China has taken advantage of tensions between the US and the Kingdom of Saudi Arabia to advance bilateral ties, a development that complicates Washington’s relationship with a key Middle East ally. The warming Beijing-Riyadh relationship is based on mutual economic and security interests and the desire for an alternative to what both nations perceive as Western interference in their internal affairs.
- China is Saudi Arabia’s largest trading partner and purchases 25% of the crude oil that the kingdom exports. In March 2022, they resumed negotiations to denominate crude oil exports to China in Chinese yuan instead of USD. Petroleum sales in yuan would insulate Chinese oil imports from possible future US sanctions against China as tensions with Washington rise.
- In a phone call between Xi Jinping and Crown Prince Muhammed Bin Salman (MBS) in April 2021, MBS suggested that his own Vision 2030 dovetailed with Xi’s Belt and Road Initiative (BRI). Vision 2030 aims to reduce the kingdom’s dependence on an oil-based economy, as China seeks more overseas investment opportunities with BRI.
- Saudi Arabia plans to complete 16 new nuclear power plants by 2030 to decrease its energy dependency on domestic oil and thereby increase its petroleum exports. Riyadh will seek to secure further Chinese civilian nuclear cooperation to build on the nuclear energy agreement the kingdom reached in 2017 with state-owned China National Nuclear Corporation.
- Saudi Arabia and China are also cooperating on defense technology. In March 2022, a Chinese state-owned technology company entered a joint venture with a Saudi defense firm to develop UAV systems in Saudi Arabia. The kingdom is reportedly building its own ballistic missiles with the help of China, according to US intelligence assessments cited in the media.
Beijing and Riyadh are aligned in their rejection of a universal standard for human rights, which they see as a Western imposition; each side has offered the other support when faced with US criticism and sanctions over its repressive domestic policies.
- Amid Western criticism, MBS visited China in February 2019—four months after the Khashoggi murder—and the two sides announced a $10 billion petrochemical deal. When meeting with MBS in Beijing, Xi said that China strongly supported Saudi Arabia’s efforts to “safeguard its sovereignty, security, and stability” and opposed “any interference in Saudi Arabia’s internal affairs.”
- MBS has voiced support for China’s massive incarceration of Uyghur Muslims, saying that China has the right to undertake “anti-terrorism” and “de-extremism” measures. Since 2020, Saudi Arabia has arrested several Chinese Uyghurs living in the kingdom at the request of the Chinese government.
- The kingdom’s explicit support of China’s suppression of Uyghurs—who are Sunni Muslims—is a major diplomatic victory for Beijing because Saudi Arabia portrays itself as the defender of Sunni Muslims worldwide.
Although China is competing with the US for technological and economic influence in the kingdom, it wants to avoid entanglement in thorny geopolitical issues such as the Middle East peace process, civil war in Yemen, and the rivalry between Saudi Arabia and Iran. China is also unlikely to replace the US as the kingdom’s main security partner and arms supplier because of the long-standing military cooperation between Washington and Riyadh and their shared stance against Iran.
- China’s Huawei Technologies is seeking to dominate 5G technology in Saudi Arabia and the Middle East, causing alarm from Washington because of concerns over cyber security and Huawei’s close relationship with the Chinese regime.
- During President Biden’s visit to Jeddah in July, Saudi Arabia agreed to invest in the US-led 5G technology called Open Radio Access Network, which enables interoperability among different equipment vendors. Huawei’s 5G technology, on the other hand, only runs on Huawei equipment. Huawei is attractive to many countries because of Chinese government subsidies.
- Establishing US-backed regional cooperation—especially between the Gulf Cooperation Council countries and Israel—to counter future Iranian aggression was a major objective of Biden’s July visit. Iran and China maintain good diplomatic and trade relations, and China will hesitate to provide Saudi Arabia with military support in a conflict against Iran.
- The US remains the kingdom’s main security partner and could withhold sales of crucial weapon systems in retaliation for future defense cooperation with China. Saudi Arabia remains dependent on US arms sales to equip its military, and the kingdom must maintain the interoperability of its US-supplied weapon systems for the foreseeable future.